The U.S. Postal
Service is proposing to cut its rates for one of the nation's top direct
marketing companies, a move that threatens the newspaper industry's biggest
money-maker: the Sunday advertising bundle.
The
post office expects to generate $15 million in profits over three years by
cutting what it charges Valassis Communications Inc. for new mass mailings.
The
newspaper industry says the deal is unfair and could wipe away $1 billion in
annual revenue it gets from Sunday newspaper inserts and the advertising fliers
it sends to non-subscribers during the week.
